In Focus

SEC to Propose Rules on Universal Proxy Card Next Week

The SEC is set to consider at an October 26 open meeting a proposal on universal proxy cards, an issue that CII has pressed for two years. This reform would give shareholders the ability to vote for any combination of management and dissident candidates in contested corporate director elections. It would have no impact on the more than 99 percent of director elections that are uncontested. CII’s General Members voted in 2013 to amend the Council’s Corporate Governance Policies to support universal proxy cards. To follow up on that, the Council submitted a rulemaking petition to the SEC in January 2014 urging the commission to amend the proxy rules to facilitate the use of universal proxy cards. When the SEC hosted a roundtable on the topic in March 2015, CII participated and submitted remarks. Since that time, the Council sent a letters to SEC Chair Mary Jo White in July 2015 and November 2015 emphasizing the critical need for universal proxy cards in director elections.

Delaware Vice Chancellor Calls on Investors to “Take Back the Vote”

Delaware Vice Chancellor Travis Laster told CII Fall Conference participants that the complex beneficial-nominee system continues to cause problems related to voting, and that solutions may be near through distributed ledger technology, the best known versions of which are called “blockchain.” Distributed ledger technologies offer a solution that would provide “better accuracy, greater transparency, and superior efficiency for settling securities trades and voting in corporate elections,” he said. A paper providing the basis for his remarks was released October 18 by CII.

CII Priorities

Universal Proxy In contests, investors should be free to vote for the nominees they prefer.

Executive Compensation CEO pay should be transparent and tied to long-term performance.

Dual-Class Stock Each share of a public company's common stock should have one vote.

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